Posts Tagged 'Business'

One of the coolest things that we get to do as a company is support the growing and thriving community of technology entrepreneurs.

Programs like TechStars provide us with the perfect opportunity to directly plug into some of the best and brightest tech talent anywhere in the world. As the number one startup accelerator in the world, TechStars receives applications from thousands of companies each year, and they only select the best of the best to be members of the program. Member companies receive perks like top-notch mentorship, free hosting, funding and the chance to present their products to venture capitalists and angel investors at the end of the program.

Several SoftLayer executives serve as mentors for TechStars, which allows us to share some of the knowledge (and some of the mistakes) we've gathered along the way. In fact, the inaugural class of the new TechStars Cloud in San Antonio will have access to SoftLayer's CSO George Karidis, our CTO Duke Skarda and me as Mentors. Not too long ago, SoftLayer was a startup, too — just a bunch of guys with a great vision, a few credit cards, and not much more. We understand how important it is to get good help and advice from others who have traveled the road before.

That's why we created the SoftLayer Startup Program. Companies in our program receive more than just advice, best practices and industry insight from us; we also provide tangible resources. Every selected company gets a free year of hosting with SoftLayer. This includes:

A $1,000 per month credit for dedicated hosting, cloud hosting, or any kind of hybrid hosting setup

Advanced infrastructure help and advice

A dedicated Senior Account Representative

Marketing support

The selection process for the SoftLayer Startup Program is pretty competitive as well, but because Tech Stars member companies had to beat the odds to get into that program, they are granted automatic admission to our program. Several of the companies who've gone through TechStars and through the SoftLayer Startup Program have become loyal customers, and you can see many of them in our Technology Partners Marketplace, where we spotlight innovative ways members of the SoftLayer community are building their businesses on our platform.

Calling All Startups!

If you're involved in a startup right now, and you're looking to get the help you deserve, email me, and I'll help you get your application submitted for the SoftLayer Startup Program. If you're focused on Cloud Infrastructure or Cloud Tools development, you have an even bigger opportunity: Priority-consideration applications for the inaugural class of TechStars Cloud are due October 21. The first class will run in San Antonio Texas from January through April of 2012. If you need just a bit more time to apply, the final application deadline is November 2. Head over to TechStars Cloud to get more information and to apply to join the latest, greatest edition of TechStars ... And you get guaranteed admission into our program where you'll enjoy all of the SoftLayer-specific benefits above!

P.S. If you want some insight into what it's like to work in a technology incubator, we recommend the TechStars series on BloombergTV that has documented the ups and downs of a few of the participants in TechStars New York.

So much of our life has been moved to digital devices these days. Smart phones are one of many devices that have made an impression on our lives. Smart phones these days have become a must for most, whether it is for business or personal use, almost everyone has one.

On the plus side, smart phones enable users to conduct business from just about anywhere in the world. Access to email accounts, VPNs and other tools that make business move on a daily basis have become accessible from the palm of your hand. You can even administer your web server from your smart phone with the right application setup.

You're carrying a small computer around in your pocket. It'll be interesting to see what new devices will emerge in the market in the next few years. Tablets are becoming wildly popular, and mainstream consumers are starting to keep an eye on the newest innovations, joining the "tech geeks" in the "early adopter" line.

There are several players in this market with Google, RIM and Apple leading the pack, and dedicated fans rally behind each. With smart phones becoming so increasingly common, I've started wondering if it's really for the best. Do we really need to check our e-mail every 10 minutes? If we're not on Twitter, Facebook or one of our other social networks, will they be there when we get to our computer?

Being digitally connected all the time give us a false sense of "socializing" in the old school face-to-face sense, and that pull us away from those IRL (in real life) encounters. Numerous crashes have been caused by people texting or updating their statuses while driving, and there have been cases of people walking into a busy street while being distracted by their phones.

When it comes to technology like smart phones, how do you keep those devices from becoming a dependency? How do you keep yourself from letting them take the place of direct human contact rather? It's something to think about as technology continues to evolve and permeate our lives.

Okay, so you've read the title and passed out already ... but wait – this is good stuff! Well, maybe not "good," but at least it's relevant. The esteemed governor of Texas with the big Texas hair (and aspirations of taking his big hair out of Texas) recently signed House Bill 1841 (HB1841) into law, and that law is significant to many of SoftLayer's customers.

Last year, the Texas Comptroller's Office amended a regulation and stated that the use of a server in Texas was adequate to establish a nexus, so an e-commerce vendor who used a Texas web host was required to collect sales tax from their customers even if the vendor had no other presence in the state of Texas. This amendment immediately created issues for web hosts with data centers in Texas: Why would customers get servers from a host in Texas and have to worry about this tax obligation, when they could do business with another host outside of Texas and not have this obligation?

Well, the Comptroller's Office started to realize the effect of this regulation and began to backpedal and say that they didn't really mean what they said.

HB1841 puts the Texas hosting industry back where it was before the Comptroller made those changes: The use of a server located in Texas without any other presence is not considered a substantial nexus for collecting sales taxes. HB1841 specifically states that "A person whose only activity in this state is conducted as a user of Internet hosting is not engaged in business in this state." Note: You may be wondering if this bill applies to Amazon in Texas, but HB1841 doesn't cover Amazon because they had a physical presence in Texas (albeit one operating under a different affiliate with a different name), requiring them to pay sales taxes.

Our very own Brenk Johnson was involved in the effort to pass HB1841. He attended a couple of committee hearings, and he'll tell you his mere presence got this out of committee and in front of our governor. He is quoted as saying, "I can sit in a meeting with the best of them."

At the risk of making this blog sound like an Academy Awards reception speech, we would like to thank Jeff Clark and the crew over at TechAmerica for helping to get this bill passed. TechAmerica is a technology advocacy group that we recently joined, and they have a cracker-jack lobby group. Our CFO and I were on the verge of hiring a lobbyist for the 2009 Texas session, but we ended up not doing so. Two years later, we decided to go with this industry group, and the verdict is that TechAmerica has been a great investment ... It was also through this group that Lance became a Cloud Commissioner! We also want to thank our competitors over at RackSpace, especially their General Counsel Alan Schoenbaum, for getting us involved and for leading and spearheading the passage of this bill ... What was good for the goose was good for the gander on this one.

Because we are back to where we were a couple of years ago in the definition of nexus with relationship to hosts with data centers in Texas, this was not really a game-changing bill. It was important to clarify and undo the damage caused by the waffling that occurred in the State's Comptroller's Office, so in that sense this was a good bill for the industry. Next session we're going to aim for the game-changer: Margin taxes!

The incubator program lasts a little over eight weeks and is very hands on, in terms of mentor and adviser involvement. Each team invited to participate will be paired up with a group of mentors and advisers that will help during the process.

At the end of each week of the eight week program, the Teens in Tech staff will meet with each company to go over how their week went and what they think will help further build their business. Every other week, Teens in Tech will organize a dinner and have a guest speaker present to the teams ... And it gives the teams a chance to interact with each other outside of building their product.

At the end of the eight weeks, the teams will present their startups to a group of Venture Capitalists, influencers, members of the press and others at an event called "Demo Day."

Teens in Tech CEO Daniel Brusilovsky invited me to join him on a quick tour of their brand new office space in Mountain View, CA, and I made sure to grab my camera to capture the environment before the team and the incubator participants moved their stuff in:

We're happy to support Teens in Tech, and we're looking forward to seeing some of the amazing companies that'll come from the best and brightest entrepreneurs under 18 years old!

SoftLayer isn't a publicly traded company, but in the interest of transparency, we do our best to share as much information about the business as we can with our customers. Earlier this week, we released our revenue and operations growth for the first quarter of 2011, and while we're happy to reach so many amazing milestones, we can't take any time to rest on our laurels.

It's no secret that we've gotten to where we are today because our 26,000+ customers trust us with their businesses. We can quantify success with revenue numbers and server counts, but at the end of the day, our business will be successful when we provide a platform for our customers to be successful. The growth of our customer base is a testament to the hard work the team has put in behind the scenes, and it also presents an interesting challenge: We need to continue to meet the needs of 26,000+ different businesses in 140+ countries around the world.

Given the amount of hair-pulling you might encounter by something as simple as setting up dinner with a group of friends, it's a pretty daunting task to incorporate thousands of disparate perspectives in our road map as we move forward, but with that challenge comes great opportunity to build SoftLayer into an even better business. Whether the request is for something as straightforward as a hardware product or as complex as geographic expansion into specific international markets, the feedback we get from our customers shapes our internal conversations (and ultimately our long-term plans).

Understanding that need for constant feedback, we're doing our best to listen to what our customers have to say. We're listening to conversations on our forums, watching updates from our customers on various social media platforms, and monitoring our sales and support customer experiences to ensure we're moving in the right direction. Recently, we incorporated a Get Satisfaction widget on our site to give our customers a platform to share their ideas, questions, problems and praises. Additionally, users can vote on existing suggestions to give us a sense of our customer base's priorities.

To all of our customers, thank you for trusting SoftLayer with your business. In response to your past requests, we've opened a new data center in San Jose, christened new pods in Dallas and Washington, D.C., launched our managed hosting service and released servers powered by the latest and greatest Intel Xeon "Sandy Bridge" and "Westmere EX" processors ... And all of those accomplishments have come since we closed the books on the success we shared from Q1.

As we continue to improve our feedback loops, you're going to see even more impressive numbers from SoftLayer, and that success will fuel our ability to continue growing the business to meet more of our customers' requests. Because we officially completed our integration with The Planet in Q1, we're able to shift our focus completely to maintaining and growing the combined business. By the end of the year, you'll see SoftLayer data centers in Europe and Asia, and as new products and technologies are released, you'll see them first from SoftLayer.

What else can we do for you? (And no, that's not a rhetorical question.)

We recently announced a partnership with the Tech Wildcatters Incubator Program, a Dallas-based "microseed" fund and startup accelerator, and we couldn't be happier with the results we've seen thus far. Much of the press coverage of the sponsorship focused on the $1,000/mo of cloud, dedicated or hybrid hosting solutions we offered the program's startup companies, but the most exciting aspect of the relationship thus far has been getting to engage with the participating up-and-coming entrepreneurs.

Having been in their seats about six years ago when SoftLayer was born in a living room, the SoftLayer team is especially qualified to give insight about the struggles and successes of running a startup, and that aspect of our partnership is where we hope to provide the most value. Over the past few weeks, we've met with the current Tech Wildcatters participants and seen some of the amazing ideas they have in the works, and we're pumped to see them succeed ... By all accounts, we can't really call SoftLayer a "startup" anymore, but our investment in this community reinvigorates the startup culture we've tried to maintain as the company has grown.

Recently, I had the chance to share a few "Keys to Success" with program participants, and since those thoughts might be interesting for other startups and small business users, I thought I'd share some of the highlights here. There are no "guaranteed win" formulas or "super-secret secrets to success" in business (regardless of what an infomercial at 3am on a Tuesday morning may tell you), but these ideas may help you position your business for success:

1. Hire people smarter than you.
Your goal should be to get people on your team who can handle specific responsibilities better than you can. Just because you're running the business doesn't mean you can't learn from it, and the best people to learn from are brilliant people.

2. Hire a diverse group.
Different people think differently, and different perspectives lead to better conversations and better business decisions. Filling your organization with one kind of employee will lead to a lot of "That's the best decision ever" moments, but whether or not that "best decision ever" decision is good for anyone else is a crap shoot.

3. Founders should put skin in the game.
With all of the startup company trials and tribulations, you want everyone on your team to have a vested interest in the business's success. Clock-punchers and coasters need not apply.

4. Boot-strap the beginning.
Along the lines of the previous recommendation, if you've remortgaged your house or sold your car or maxed out your credit cards on a new business, you're going to care a lot more if it fails. By boot-strapping your initial financing, you become even more accountable for your success.

5. Operate with financial sense, operational sense and common sense.
Balance your business responsibly. If you disregard any of those "senses," your tenure as a small business owner may be relatively short-lived. When it comes to financial sense, I also recommend that you invest in professional accounting support and software to save you a ton of headache and heartache down the road when it's time to go after "real money."

6. CBNO - Challenging But Not Overwhelming
You can always do something more for the business. You and your team should be maximizing your efforts to grow the business but not at the expense of burning out. If you've got "skin in the game," your threshold for what is overwhelming may increase, but you have to understand the need for balance.

7. Have fun and make money.
In that order. If you're not having fun, it doesn't matter how much money you make. Startups are run by passionate people, and the second you lose that passion, you lose a significant piece of what makes your business or idea great.

I touched on about a dozen more points when it comes to how to orient your business to your customers, but I'll save that bit for later.

<Fade In>
Man driving into Jiffy Lube, car sputtering and smoking.
Attendant: "Looks like you need an oil change buddy."
Buddy: "Yep, I think so. I was here last week and I think they used the wrong oil!"
Attendant: "Nah, we wouldn't do that. In fact we only have one kind of oil here and that's SAS 70."
Buddy: "Well, that's odd; I am told that I need SSAE 16 for mine to work right."
<Mass Confusion>

Welcome to my world! We have SAS 70 today, but soon we will have the new synthetic, non abrasive, engine-cleaning SSAE 16. Sounds fun right? I sure hope so.

Why the change? Good question. When SAS 70 first appeared in the early 90s, the world's economies weren't quite as intertwined as they are today. It was much harder to do business globally than it is now. (I think the "fad" called the internet has a little something to do with that but I could be wrong!) Now that the oceans have shrunk to a more manageable size, there is a need for the standards that companies use worldwide to match more closely. The goal of the U.S. Statement on Standards for Attestation Engagements 16 (SSAE 16) is to meet a more uniform reporting standard.

What's the difference? It's an "attestation" not an "audit." Google and thefreedictionary.com define attestation as "To affirm to be correct, true, or genuine," and audit as "an inspection, correction, and verification of business accounts." Though they are closely related, they mean different things.

What stay's the same? The focus will still be on controls at service organizations when the controls are relevant to their user entities' internal control over financial reporting. (For some reason, servers tend to have quite a bit to do with that!) There will still be a Type 1 and Type 2 with similar scopes in format. The reports will look very similar but they should be a bit more descriptive. The report will still be used in the same methods and by the same type of user.

What Changes? SSAE 16 is now an attestation and not really an audit. The service auditor will still provide an opinion but it will align itself more closely with existing international attestation standards.

Written Management Assertion - Management will be required to provide an assertion, to be included in the report, stating the system is fairly represented, suitably designed and implemented and the related controls were suitably designed to achieve the stated control objectives, and that the controls operated effectively throughout the period. The report will reference that management is responsible for preparing the system description, providing the stated services, specifying the control objectives, identifying the risks, selecting the criteria and designing, implementing and documenting controls that are suitably designed and operating effectively. The auditor's opinion remains in the role of providing assurance, not as the entity responsible for the communication.

System Description - The more inclusive description must detail the services covered, classes of transactions, events other than transactions, report preparation processes, control objectives and related controls, complementary user controls and other relevant aspects of the organization's control environment, risk assessment process, information and communication systems, control activities and monitoring controls. (I think an accountant came up with all of that!)

There are quite a few other differences but I think these are the big headliners. SoftLayer is committed to making this change and having it available for our customers that require it. Our normal SAS 70 schedule is Nov. 1 – Oct. 31 but we will be accelerating the process to have the SSAE 16 in place as soon as possible.

We are continuously looking at other compliance, reporting, audits and certifications. If you have any that would help you and your business, let us know.

Our second Dallas data center went live 10 days ago and we are already pushing 10 GB of sustainable traffic out the door. I have spent some time in the DC with some of our ops guys, and the place is impressive.

A terrific amount of computing power sits in row after row of server racks, driving a diverse array of business to more than 110 countries. Each rack features powerful processors, lots of RAM and heaps of storage. There is very little that our customers are unable to do over Softlayer’s infrastructure. And if they need more, SoftLayer can add additional servers very quickly to meet this demand. I wish the rest of our business were as simple as this.

Despite the state of the art infrastructure that sits in the DC, it remains a challenge to meet the needs of our customers. Why? Network, that’s why. SoftLayer’s challenge will be to continuously stay ahead of our customers’ demands, primarily in the network. If the network is unable to support the traffic that is pushed across our DC, everything comes tumbling down.

To a degree, we are victims of our own success. As we add servers to racks, we are placing increasing demand on the network. The more successful we are, the more pressure we place on the network.

Consider the following statistics:

When SoftLayer went live five years ago, we used two carriers and pushed 20 Gbps out the door.

Four years ago, this had gone up to four carriers and eight 10 Gbps links.

In January 2009 we pushed about 70 Gbps of sustained traffic. And this doubled for President Obama’s inauguration.

Today we use over ten carriers, with over 1000 Gbps of capacity.

In addition to the needs that our customers drive, we cannot forget to consider DDOS attacks as DDOS attacks add significant load to the network. We consistently absorb and successfully defend attacks of 5 Gbps, 10 Gbps or more and the peaks have grown by a factor of ten since SoftLayer went live.

The trend revealed is significant – in five years the amount of traffic sustained over our network has increased by more than ten times. And it shows little signs of slowing down.

Suffice to say, we spend a significant amount of time designing our networks to ensure that we are able to handle the traffic loads that are generated – we have to. Aggressively overbuilding the network brings us some short term pain, but if we are going to stay ahead of demand it is simply good business (and it makes sure our customers are happy). The new DC in Dallas is a great example of how we stay ahead of the game.

Each server has 5 NICs – 2 x 1 Gbps (bonded) for the public network, 2 x 1 Gbps (bonded) for the private network and one for management. The net of this is that customers can push 2 Gbps to the internet assuming server processors can handle the load.

Serving up content on the internet can be a tricky business. It isn’t just about running a web or app server(s) in an efficient and reliable manner. One of the other critical factors is DNS. You have to understand and optimize how the name the content is advertised under gets translated to the IP address of the content. I don’t want to turn this into a DNS primer, but the two ends of the line of communication are the authoritative DNS server controlled by the domain owner which stores the official translation of the name to the number and the resolving DNS server which acts as a cache and is where the end-user connects to directly. Both ends of the chain have their own idiosyncrasies which can affect how quickly and reliably your content gets delivered.

On the end-user side, I just read an article about how public DNS providers like OpenDNS and Google are breaking the internet. OK, maybe not breaking the internet, but the public DNS providers are confusing CDN location-based algorithms. The article is here: http://www.sajalkayan.com/in-a-cdnd-world-opendns-is-the-enemy.html and I recommend strongly that both content providers and content consumers read it.

The summary is that some CDN algorithms use the ip address (and location) of the DNS server making the request and if that DNS server is nowhere near the end-user on the internet, the end-user will get served content from farther away and will get that content slower than desired. The conclusion is that an end-user should always use a DNS server located as close as possible network-wise, usually that ends up being a DNS server of the network provider.

That is good advice for the end-user, but what about the content provider? If you flip this around and come at DNS from the content provider’s point of view who doesn’t use CDN, you want to make sure that when a DNS request is made, that your authoritative DNS server gets the ip address as fast and reliably as possible back to the end-user.

SoftLayer has built out authoritative DNS farms in all our Datacenters and Network POPs and anycasted the ip addresses for the name servers. What that means is that SoftLayer customers – who get to use our DNS for free – can have their authoritative domain services hosted at all 10 points in North America and through the routing optimization inherent in the internet, the name to number conversion for those domains will happen as close as possible to the end-user and the results will be delivered as quickly as possible.

One very important goal of every content provider is to get the end-user the best experience as possible. Understanding how the internet works from the end-user and well as the server-side is critical. It doesn’t matter how good your content or app is if the end-user has a poor experience.

No matter what industry you are in, a key to a successful business is always being one step ahead of your competitors. Look at Blockbuster, who just filed for bankruptcy. Netflix came along then RedBox, Blockbuster couldn’t keep up. Blockbuster tried mimicking these two versions of video/game rental, but failed. Now you can order Netflix off your Xbox 360. There is a RedBox on almost every corner of the Metroplex or at least at every drug store. There is also video on-demand for almost every cable or satellite provider.

I went to a luncheon recently. The topic was “The Next Generation of IT Delivered Through Innovations.” The speaker was Scott Garvey, Director Enterprise Solutions from Microsoft. Scott brought up a good statistic; most companies only survive on “top”, nowadays, for about 12 years when the timeline used to be 75 years. He spoke about the different ways Microsoft plans to stay one step ahead of their competitors. He stated that his company spends billions of dollars on Research and Development a year. While SoftLayer is not quite to the point of spending that much, it still made me think about how we are keeping one step ahead of our competitors.

We are constantly rolling out new features, certifications, products, and partnerships. While we are not quite on top yet, we will get there. We are only three months into this year and we have already rolled out five new features, one certification, and two new partnerships. This is one reason we are growing so fast; but, even better, we are staying one step ahead of our competitors.